Shares of WWE got body-slammed Thursday as the wrestling network slashed its profit forecast and missed Wall Street’s expectations at its media, live events and merchandise businesses.
Investors were likewise alarmed that the colossus founded by Vince McMahon revealed on Thursday it hadn’t yet renewed broadcast deals in key markets overseas.
Those included Saudi Arabia, despite the fact that WWE separately on Thursday was busy staging its pay-per-view “Crown Jewel” bash in Riyadh, featuring WWE’s first-ever women’s match in the country.
On a Thursday conference call, WWE co-president George Barrios blamed a slashed profit outlook partly on unexpected delays to the Saudi Arabia deal, noting that WWE and some of its other overseas partners had yet to find “common ground.”
The stock tumbled 16%, to $56.04, after briefly hitting a 52-week low.
“There is a lot of uncertainty surrounding the results of several international renewals for ‘Raw’ and ‘SmackDown,’” Brandon Ross, an analyst at LightShed Partners, said of media-rights deals for WWE’s two weekly shows.
“A delay in closing one of the major deals has unsettled investors, especially since clarity will not be given until a February investor day,” he said.
WWE’s media segment had $146.1 million in revenue, short of the expected $146.8 million. Live events and consumer products brought in $23.2 million and $17 million, respectively, also missing forecasts.
The disappointing media results reflected, in part, a 9% decline in paid subscribers to WWE Network — the company’s online video streaming service. The service, which charges $9.99 a month, averaged 1.51 million paid subscribers during the quarter.
WWE said it expected that number to fall 10%, to 1.43 million, in the fourth quarter. When pressed, Barrios refused to blame new and lower-priced services like Apple TV+ and Disney+ for subscription losses at WWE Network.
The lower number of WWE events in the third quarter — 74 this year compared with 90 last year — accounted for most of the revenue declines in WWE’s live events and consumer products sectors.
WWE didn’t directly address having fewer shows, although observers noted management has mostly focused on the Oct. 4 move of “SmackDown” to Fox.
WWE called the move an unqualified success, saying the 3.9 million viewers for the premier broadcast represented a 221% surge in the audience drawn to the same time slot in the preceding four weeks.